Friday, May 11, 2012

SPY Holds Above Support Following JPM Drop...


The SPY opened higher on Friday, rose to 136. 85 and then pulled back to close at 136.02.  The SPY formed an inverted hammer at the mid section of Wednesday’s range, which is the low day of the recent short term down trend.  The SPY has been going sideway’s at support for four days.

Two of nine sectors moved higher on Friday.  XLK, XLU, and XLV were the strongest sectors.

Breadth weakened as decliners led advancers led 1.50 to 1 on the NYSE and 1.52 to 1 on the NASDAQ.

Exchange        NYSE       NASDAQ
Advancers      1,198             985
Decliners        1,803          1,502

SPY moved down 41 cents on 153 million shares…

AAPL was down -3.81 to 566.71 on 14.2 million shares and formed an inverted hammer…

NVDA +0.79, +6.36% after reporting earnings on Friday morning


Technical Commentary:

Financial stocks opened lower after JPM disclosed in a conference call on Thursday that it has a $2 billion trading loss from large positions in credit-default swaps that will affect its Q2 results.  JPM was down -3.78 or -9.28% on Friday.  C and BAC were lower on Friday, however WFC, STI and ZION closed higher after opening lowerInvestment banks GS and MS also closed lower.

XLF opened near its low and closed higher notwithstanding the JPM selloff.

The Euro was slightly lower.  TNX was down and the VIX higher.

We will continue to watch the Euro and TNX Monday morning to observe to see if trading holds above recent support and if TNX bounces from the area of its nine month lows. 

Breakout – GILD, UAL, BIIB

Breakout Setup – ADM, WDC, EBAY, GOOG, AMZN, CATM

Flag Bounce – CRUS, STI, ORLY, AMGN

Flag SetupCHL, FIRE, BGC, LULU, GRMN, URE, DLR, LNKD, TSL, SWI, ROST, VRSN, DLTR, WCRX, CTXS, EXPE, SHLD, BA, CERN, DDD, GWR

Confirmed MACD Divergence – ZION, BRCM, FAST

Potential MACD Divergence - AKAM, SWK, BAC, FLEX

Bear Flag Setup - ADP, KLAC, PAYX, SPLS


53 of 100 NDX stocks closed higher on Friday…


Leading NDX 100 stocks included NFLX, NVDA, BBBY, VRTX, LRCX, MYL, MRVL, BIIB, FFIV, INTC

Lagging NDX stocks included GMCR, APOL, SIRI, CSCO, INFY, YHOO, GOOG, GOLD, BIDU, EBAY

Leading stocks > +2% on Friday included LDK, CIEN, TPX, CROX, FAZ, ZAGG, DECK, NTES

Losing stocks < -2.0% included C, PCX, GS, ANR, LNKD, CSTR, FAS, TSLA

Stocks to Watch on Monday

Holding Above 30 DMA = 11
TLT, URE, CHL, LNKD, CRUS, CREE, SWI, TSL, VECO, FAZ, UAL

Moving Above 30 DMA = 2
LDK, STI

Moving Below 30 DMA = 1
WDC

Staying Below 30 DMA
DLR, NTES, NKE, ATI, ANF, AGI, ZAGG, CRM, FCX, IBM, SLB, CMG, DHR, ESI, FAS, FCX, SMH, SWKS, TIF, UCO, V, AKS, ANR, JNPR, X, HLF, SOHO, DECK, HUM, CROX, LVS, FAZ, CIEN, PCX, RCL, RVBD, CLF, MCP, SWK, TPX, X, ZION, INFA, BAC, A, TBT, F, JDSU, C, GS, TSLA, COH, GRPN, MOS, ICE, SINA, GES, CDE

Six Week Intermediate Term Market Trend: Neutral
Short Term Market Trend: Neutral

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